Finally, some good news out of Washington! It looks like the rules on credit cards are going to be revised to make them more consumer friendly!
The new rules would require companies to tell customers 45 days before terms of a credit card contract are changed, compared with 15 days now. And the rules would expand the list of changes requiring advance notice to include those involving penalty interest rates, which often range above 30 percent. Today, most consumers learn only after opening their monthly bills that they have been penalized with significantly higher interest rates because of paying late, going over their credit limits or falling behind with another lender.
Companies would also be required to spell out that low rates on balances transferred from another credit card apply only to that balance, not to new purchases. And it would require companies to apply payments to the debt carrying the highest interest rate. Many companies now apply payments to the least costly debt, thus forcing customers to pay more in interest.
These measures will definitely help people in getting out of debt. Still, it is shocking that consumers can be treated so badly by an industry without any public scorn. These changes still don’t make credit cards a good method of payment, but they at least start to even the playing field.